The World’s Largest Hedge Fund Sold 5 Chinese Stocks. Here’s Why.

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Bridgewater Associates, the hedge fund founded by Ray Dalio, has sold many of its holdings in China, as the world’s second-biggest economy shows signs of cooling.

Bridgewater no longer owned stock in

Alibaba Group Holding

(BABA),

Bilibili

(BILI),

JD.com

(JD),

NetEase

(NTES), and

DiDi Global

(DIDI) as of June 30, according to a regulatory filing dated Aug 11.

The firm held shares in the five companies at the end of the first quarter, or as of March 31, a different SEC filing, dated May 13, said.

Bridgewater in Q1 owned about 7.5 million shares of Alibaba, 1.1 million shares of Bilibili, 2.1 million shares of JD.com, 370,125 shares of NetEase, and about 8.15 million shares of DiDi for the three months ended March 31, according to regulatory filings.

The stock sales of the five companies is worth more than $1 billion combined. 

Bridgewater trimmed its stake in

Tencent Music Entertainment

(TME) to about 3.02 million shares from 3.1 million in Q2. It also reduced its holdings in several other Chinese stocks including

Agora

(API),

BeiGene

(BGNE),

Baozun

(BZUN),

New Oriental Education & Technology

(EDU), and Weibo (WB).  

Bridgewater did increase its holding in

Baidu

(BIDU) in the second quarter by about 2%, bringing its ownership to about 1.14 million shares. It also boosted its stake in

Zai Lab

(ZLAB) by 80%, to 637,181 shares.

A Bridgewater spokeswoman declined to comment.

Dalio founded Bridgewater, considered the world’s biggest hedge fund, in 1975. The fund currently has about $150 billion in assets under management.

In 2017, Dalio stepped down as co-CEO. Bridgewater is led by Nir Bar Dea and Mark Bertolini, who are co-CEOs. Dalio is still intimately involved in the firm but is currently one of three co-chief investment officers.

Dalio is also a longtime China bull and in November raised $1.25 billion for its third China investment fund, The Wall Street Journal reported. 

News of Bridgewater’s stock sales comes as China’s central bank cut interest rates Monday after data showed a weakening of retail sales and factory output. On Sunday, China reported industrial production growth for July of 3.8% year over year, while economists had projected 4.3%. 

Chinese regulators over the past year have sought to rein in the technology sector in that country. DiDi, the ride hailing app that went public in the U.S. last year, faced intense scrutiny. It was at the heart of a crackdown by Beijing on U.S.-listed technology companies in July 2021.

Write to Luisa Beltran at [email protected]